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2026 Capital Gains Tax Brackets – As we approach the 2026 tax year, understanding capital gains taxes is crucial for investors, homeowners, and anyone selling assets. Capital gains taxes apply to the profits made from selling investments like stocks, bonds, real estate, or other assets. The tax rate depends on how long you’ve held the asset and your overall taxable income. In this article, we’ll break down the 2026 capital gains tax brackets, including both short-term and long-term rates, based on the latest IRS adjustments. These brackets reflect inflation adjustments and any legislative updates, ensuring you’re prepared for tax filing in 2027.
What Are Capital Gains Taxes?
Capital gains are the profits realized when you sell an asset for more than its purchase price (adjusted basis). The IRS distinguishes between two types:
- Short-term capital gains: Profits from assets held for one year or less. These are taxed at ordinary federal income tax rates.
- Long-term capital gains: Profits from assets held for more than one year. These qualify for preferential lower tax rates of 0%, 15%, or 20%.
Additionally, qualified dividends are often taxed at long-term capital gains rates. High earners may also face the Net Investment Income Tax (NIIT), an extra 3.8% on investment income if modified adjusted gross income exceeds $200,000 for singles or $250,000 for married couples filing jointly.
2026 Short-Term Capital Gains Tax Brackets
Short-term capital gains are added to your regular income and taxed according to the federal income tax brackets. For 2026, the IRS has adjusted these brackets for inflation under Revenue Procedure 2025-32. There are seven progressive rates: 10%, 12%, 22%, 24%, 32%, 35%, and 37%. Here’s a breakdown by filing status:
| Tax Rate | Single | Married Filing Jointly | Married Filing Separately | Head of Household |
|---|---|---|---|---|
| 10% | $0 – $12,400 | $0 – $24,800 | $0 – $12,400 | $0 – $17,700 |
| 12% | $12,401 – $50,400 | $24,801 – $100,800 | $12,401 – $50,400 | $17,701 – $67,450 |
| 22% | $50,401 – $105,700 | $100,801 – $211,400 | $50,401 – $105,700 | $67,451 – $105,700 |
| 24% | $105,701 – $201,775 | $211,401 – $403,550 | $105,701 – $201,775 | $105,701 – $201,750 |
| 32% | $201,776 – $256,225 | $403,551 – $512,450 | $201,776 – $256,225 | $201,751 – $256,200 |
| 35% | $256,226 – $640,600 | $512,451 – $768,700 | $256,226 – $384,350 | $256,201 – $640,600 |
| 37% | Over $640,600 | Over $768,700 | Over $384,350 | Over $640,600 |
These thresholds represent taxable income after deductions. If your short-term gains push you into a higher bracket, only the excess is taxed at the higher rate.
2026 Long-Term Capital Gains Tax Brackets
Long-term capital gains enjoy lower rates, encouraging longer investment holding periods. For 2026, the rates remain 0%, 15%, and 20%, with thresholds adjusted for inflation. The brackets are based on your taxable income and filing status:
| Tax Rate | Single | Married Filing Jointly | Married Filing Separately | Head of Household |
|---|---|---|---|---|
| 0% | $0 – $49,450 | $0 – $98,900 | $0 – $49,450 | $0 – $66,200 |
| 15% | $49,451 – $545,500 | $98,901 – $613,700 | $49,451 – $306,850 | $66,201 – $579,600 |
| 20% | Over $545,500 | Over $613,700 | Over $306,850 | Over $579,600 |
For example, a single filer with $40,000 in taxable income (including long-term gains) would pay 0% on those gains. If their income reaches $60,000, they’d pay 15% on the portion above $49,450. Estates and trusts have separate brackets: 0% up to $3,300, 15% from $3,301 to $16,250, and 20% above $16,250.
Changes from 2025 and Key Updates
The 2026 brackets reflect annual inflation adjustments by the IRS, increasing thresholds by about 2-3% from 2025 levels. The One Big Beautiful Bill Act (OBBBA) made certain tax provisions permanent but did not alter the core capital gains rates. However, the NIIT remains unchanged at 3.8% for high-income taxpayers, potentially bringing effective rates to 18.8%, 23.8%, or more when combined with state taxes.
Note that collectibles (e.g., art, antiques) are taxed at a maximum 28% rate, and unrecaptured Section 1250 gains from real estate at 25%, regardless of holding period.
How to Calculate Your 2026 Capital Gains Tax?
- Determine your holding period: Short-term or long-term?
- Calculate your gain: Sale price minus adjusted basis (purchase price + improvements – depreciation).
- Add to taxable income: Apply the appropriate bracket.
- Factor in losses: Capital losses can offset gains, with up to $3,000 deductible against ordinary income if losses exceed gains.
Use IRS Form 8949 and Schedule D for reporting.
Strategies to Minimize Capital Gains Taxes in 2026
- Hold assets longer: Qualify for lower long-term rates.
- Tax-loss harvesting: Sell losing investments to offset gains.
- Roth conversions or charitable donations: Reduce taxable income.
- Opportunity zones or 1031 exchanges: Defer gains on real estate.
- Stay in lower brackets: Time sales when income is lower.
Consult a tax professional for personalized advice, especially with complex portfolios.
Final Thoughts on 2026 Capital Gains Taxes
Staying informed about the 2026 capital gains tax brackets can help you make smarter investment decisions and potentially save thousands. With thresholds rising due to inflation, more taxpayers may qualify for the 0% or 15% rates. Always verify with the latest IRS guidance, as rules can evolve. For more details, visit the IRS website or speak with a certified tax advisor.